The Water-Energy Nexus: A Deeper Look

The Water-Energy Nexus Revisited:  Water Conservation, Potable Reuse, and Desalination

Water and energy are fundamentally and inextricably connected. In our last article on the subject, we introduced the water-energy nexus and explored the greenhouse gas and climate impacts of the 48 terawatt-hours of electricity used every year to power the transportation, treatment, and disposal of water in the Golden State. For a sense of scale, Californians use more energy to move, treat, and dispose of water than the entire state of Oregon uses for any purpose. Despite the fact that water and energy are so interconnected, California’s public utilities policymakers and regulators have historically approached and managed the two sectors completely independently. Perhaps it’s time to rethink that approach. If water regulators and utilities were required to analyze and consider the variable energy intensity of different water supply sources and prioritize the most efficient sources, everyone would benefit.


Prioritizing conservation in the energy sector with loading orders


In the energy sector, there is widespread agreement that efficiencies should be sought and prioritized at every opportunity. Reducing waste is cheaper and easier than increasing supply. This consensus is implemented through existing policy and regulation. According to the California Public Utilities Commission, the “loading order” is “a policy that specifies priorities for both demand side and supply side projects. The demand side projects, energy efficiency and demand response, are assigned the highest priority in the order followed by renewables and clean fossil projects on the supply side.” This approach is just common sense. From both the ratepayer’s and the utility’s perspective, it’s cheaper and less resource-intensive for a utility to subsidize or underwrite energy efficiency home retrofits that reduce overall electricity demand before sinking millions of dollars into a new power plant that might prove to be unnecessary and that would end up costing ratepayers much more in the long run. What homeowner would say no to a free or heavily subsidized smart meter, double-paned windows, and improved insulation, along with a greatly reduced future monthly energy bill? On the supply side, the loading order and the state’s Renewables Portfolio Standard require that utilities prioritize renewables, because they are low- or zero-carbon and thus impose fewer external costs on society and future generations.


Lessons for the Water Sector


In the water sector, the San Diego Regional Water Quality Control Board and water utilities could take a similar approach. Before going to the expense of adding additional water supply capacity, they could first address inefficiencies and waste on the demand side by subsidizing or underwriting the cost of water-saving home improvements like fixing leaky pipes and installing drip irrigation and low-flow toilets. Ratepayers would save on their bills not only because of their reduced water usage, but also because utilities would have fewer capital costs to pass along. Once those efforts are exhausted, and additional water supply sources become necessary, regulators and utilities could look first to the water supply sources with the lowest cost, energy intensities, and environmental impacts, like potable reuse, before resorting to expensive and energy-intensive water supply sources like desalination and imported water. According to the California Energy Commission, ocean desalination uses 13,800 kilowatt-hours per million gallons (kWh/MG) produced, while advanced wastewater treatment uses only around 2,000 kWh/MG, and distributing recycled water only uses around 3,000 kWh/MG. As to how that plays out in terms of cost in the local context, Point Loma Nazarene University’s Fermanian Business and Economics Institute analyzed different water supply options and determined that the marginal cost of desalinated ocean water was $1,800-$2,800 per acre foot, compared to $1,200-$1,800 per acre foot for recycled potable water and $150-$1000 per acre foot for conservation/demand management. There’s no sense relying on a water supply option that’s more expensive and over five times as energy intense when better options are available.